Our fearless editor suggested that a subject for this issue could be something erudite around the financial crisis.
Merging issues to do with IT technology and the politics of envy and greed is a tall one, but what the heck here goes.
First I thought naw, fair suck of the sauce bottle, what can get worse here in NSW.
How can we use words in a sentence such as health, funding, service, taxpayer, government, bureaucrat, queues and/or shock-horror in it somewhere - that paints a situation more dire than we already experience?
Jokes about the Department(s) of Health and Ageing being better described as a Department of Sickness and Death are passé.
But, pardon the cliché, life goes on.
I guess socially and clinically there is a potentially sad story looming if depression and suicides become a growth problem.
Or, self inflicted wounds from too much DIY activity by out of work ex-hedge funders, who have a need to trim their own hedges and gardens to save money, and lose a finger or toe here and there.
Not so sad, true, but perhaps a good metaphor all the same.
There will be consequences to any sector that can’t handle the good times let alone a catastrophe, which clearly the business side of public hospitals illustrates only too starkly.
So it is all about the availability and husbanding of money.
Boom, bust, bear, bull, recession, depression or any other financial cycle, nothing good will or can happen in the health sector without adequate streams of well-managed money supply. Birth, death, sickness and care generally must go on; so let’s use the available money better. For pity sake it isn’t being used at all well at present.
Can this global financial crisis be used as an opportunity to lever change within the world of secrets, spin and mirrors?
It is a timely call because the long-suffering workforce is so used to listening to ‘pants on fire’ promises that only an extraordinary event, that creates a radical proposal, could get them to believe things could improve.
I like to digress.
Once up on a time I spent a decade or so working for a well known pharmacy outfit – not known so much for an excess of soul but certainly for their financial acumen.
The one or two older readers, of the three of four who read this column, will know this story from an article years ago, but it is worth retelling.
During the Depression the ‘Firm’, both the Washington and the Patinson parts, along with the broader chemist community prospered beyond any understanding at the time.
In hindsight the theory of the events is a bit easier to comprehend; people got depressed, people wanted to be happy, people bought little luxuries or feel-better products like antacids and lipstick.
So, I doubt there is bad news looming for you guys out there in community pharmacy-land as the Fannies and Freddies in the USA sort out who owes who the rent money.
What about hospitals?
Private hospitals could be subject to serious pressures.
Simply because they have to turn their money over profitably or sink.
So, if things get bad enough and the pressure really comes on, then investment will cease and jobs will go.
If they hit rock bottom the management will look to any tool available to do things better; ergo, they will embrace more technology, more use of the internet, less use of paper and other ‘so-last-century’ practice and climb back up the efficiency scale again.
It’s called capitalism – recognise the problem and fix it – simple – otherwise it is good night nurse.
But in public hospitals that won’t happen.
That is, it will not happen naturally because while the money-market will force pain on any private enterprise, that doesn’t mean the public ‘yes-minister’ audience will suffer in the same way.
The market force isn’t ruthlessly present in the world of the Departments of Smoke and Mirrors. Political and industrial force drives the public circus and in this context drive is not the word to use; handbrake is the word to use.
These backroom forces live off the fat of the land until either the political or the industrial situation changes, and then it is still very hard to cut into the fat.
I wonder every day as I contemplate my navel, why it is we still say – Public Health, Public Education and Public Transport? When the word ‘public’ is actually analogous to the words ‘vested interest’ so, how do we separate industrial issues from financial issues?
It is called an election.
When things get bad enough the taxpayers will want blood as we have just seen in the four by-elections recently in NSW.
The answer to the rhetorical question is to give the power of financial visibility to the good guys and get rid of the bad guys.
Where are the likely heroes to be found?
Did you happen to see the recent piece on television on the life of Paul Newman?
Not so much about the spaghetti sauce but rather the two movies that will forever be linked to him. The Hustler and the Sting.
In both stories we see the gullible, slow moving dopes, fat cats and other no-good capitalist investment hedgers get taken for big amounts of money.
Good-bad guys, rip off bad-goose guys; nice simple fairytale that has been retold over and over again.
Worth mentioning another movie in this genre and with the same pair of guys called ‘Butch Cassidy and the Sundance kid’.
The line I remember more than any other is when Butch asked Sundance - “who are these guys” (the avenging posse)?
And the follow up line – “are they still coming after us”?
“Yes” Sundance says – ‘‘they are still after us”!
The posse is showing momentum, urgency, commitment, responsibility and determination that illustrates to our heroes that there is nowhere to hide.
How can we move along with these ‘no-where-to-hide’ analogies in public health cash management?
In earlier articles I have suggested that we should leave the clinical world alone until we get the commercial ICT infrastructure in place.
Someone must see that existing technology, simple technology, will underpin better outcomes than what exists today; if, and it is a big if, the supporting political will to effect bottom upon change is in place to deliver leadership incentives and workplace convenience.
Are you following me here?
What if, in our fairy tale, we could find a way to reverse the hustle and the sting approach? Rather than rip off the fat cats, we find a way to rip out the fat.
There is plenty of fat there believe me.
Say we find a modern day, real world Newman and a Redford team and propose a hustle and sting along these lines:
- The target would be to take $3 billion over three years from the hospital supply and accounting ledgers and reticulate the funds back into front line expenditure.
The requirement is to put in place the tools and systems that will manage the money tree to maintain effective cash usage, while not impacting on clinical performance other than to improve access and convenience to goods and services.
N and R would have a fixed time contract of three years plus a watching brief for a further two years.
The incentive in the first three years, is a single digit percentage commission on all net savings, to N and R (after IT and other outgoings) in and towards achieving the $3 billion target.
For the consolidating two-years, a proportional fee will be paid to N and R commensurate with the saving maintained by their efforts; and
- On day 1, year six, N and R hand over the hustle and the sting project to permanent leaders with a staffing organisation capable of delivering the ongoing, world class, world class outcomes in money management in healthcare.
Ok, ok, a bit corny, but why not?
If we are facing the worst financial environment since the 1930s then let’s use the opportunity to change things before things change us.
To avoid disastrous, un-managed financial change that could be even worse than today’s levels and will result in a further lowering of health delivery outcomes to a second world level.
And this is, in commercial speak, Dick ‘n Jane simple stuff.
No more or less than you do every day as a community pharmacy with a business bent:
- Use technology effectively. Connect the information streams into a common database. Align the data (as you use barcodes). Send out electronic purchase orders (as use POS and PDE);Process the ship and receiving data electronically;Process the inbound invoice, preferably as a paperless transaction.
Pay the invoice electronically;Know stock turns, service levels and availability (no hoarding needed). Control wastage, minimise theft and other forms of hanky panky. Balance the books (overdraft and archives); and
- Use the ICT systems platform to give constant visibility as to where the money is at any time or in any place.
What is not simple is the complexity of the internal hospital fiefdoms that make the scale and scope issues of information visibility so dysfunctional. I have previously mentioned all of this in these pages, as a ‘in-house - outsourcing’ model; by that I mean to bring in capable leaders, locally at the coal face and centrally, with bottom-up ICT, hospitality, financial, supply, logistics, accounts and other business skills to replace the ‘yes-minister’ incumbents who should be elsewhere, doesn't matter where, just elsewhere.
So the N and R led delivery team could be any mix of existing and fresh people who will remain way past the hustle and sting crisis reaction stage.
But equally acknowledging that the N and R stars; the senior leadership team will have to be the best people that money can buy, for the fixed period of time of the incentive platform.
Let’s get plebeian.
We all hate reading about the disgustingly huge (like, huh, why not me!) salaries, share allocations and bonuses the financial gurus have showered themselves over the past years. Now that things have gone south for these masters of the global financial universe, we say - “hooray, punish the buggers”.
Whereas, there is case to take the model of huge rewards and pay something commensurable to anyone who can do the reverse, and put billions back into frontline healthcare rather than being ‘lost’ in the bottomless hole we call HealthCare funding.
Therefore the hustle factor is to get urgency and momentum underway and the sting is to reverse the rip-off scams in funding ownership away from bureaucrats and into support for point-of-patient care.
Meanwhile, you in community pharmacy, can all stock-up on life’s little pills, potions and cosmetic pleasures that are traditionally found in pharmacy, and know that at least your business model is sound.
I will wrap up with a reminder of the truth in the old saying about technology and business data.
In the 1980s the truism was …………….“garbage in- garbage out”
With the Internet this was changed to …………..“garbage at the speed of light”
What we are now learning is that national economies, like Iceland, can implode in hours of bad news spreading electronically, with nowhere to hide.
The fact is that technology didn’t cause the mayhem, it is just allowing us to all know instantly how bad things are – like in how much these financial wannabe's have screwed the world before the warning bells rang.
The foreign banks (our B.bankers seem to be a cut above) and financial houses (an article in this week’s Guardian newspaper- “Secret Sector next to face squeeze” - in the UK says – “10,000 hedge funds will collapse worldwide in 2009”) hid the bad news so it couldn’t be shared and seen until the sewers overflowed, so to speak.
So it is in our hospitals.
The health community is a labyrinth of separate societies and sewers of disparate databases. All hiding the bad news. Mainly through the inability to measure the bad news in the first place.
This lack of (non-clinical) management over financial accountability and visibility is appalling. Our frontline clinical health care performance is not sick; it is our backroom bureaucratic money managers who are the problem.
All the lipstick and gloss in the world won’t hide the facts if the overall cash flow comes to a point where the lenders have no money to give.If the financial crisis actually gets this bad then the keepers of the secrets within the Departments of Spin and Mirrors will have to come clean and ‘fess up along the lines of a Lehman Brothers mea culpa.
Then it might not be optional as to whether we will have to give an N and R recovery team the keys to the accounting offices.
Someone will have to do something.